Judge Awards Contractor $1.1M In School Lawsuit

SNOW HILL – The trial in the $1.3 million-plus lawsuit filed last year against the Worcester County Board of Education by a private contractor replaced mid-way through the construction of the new Ocean City Elementary School over two years ago concluded late yesterday after four days when visiting Judge R. L. Karwacki ruled in favor of the plaintiffs.

The Worcester County Board of Education in January 2005 hired Beka Industries, a private contractor out of Easton, to do site grading work for the new Ocean City Elementary School in West Ocean City. In August 2005, the school board allegedly became unsatisfied with the pace of the work being done by Beka Industries and replaced the company with another contractor, Precision Grading.

Last October, Beka Industries filed a breach of contract lawsuit against the Worcester County Board of Education seeking repayment for the entire amount it estimated it was due for its work on OCES. The number totaled just over $1.3 million.

Late yesterday, the judge quickly ruled in favor of Beka Industries, awarding the private contracting firm $1.1 million in damages. The judge did not award the entire $1.3 million Beka Industries was seeking, nor did he award the plaintiffs the additional money for attorney fees and the cost of litigation it was seeking, however.

The original contract between the school board and Beka Industries was $1.8 million, of which $1.4 million was paid to the contractor. However, the school board’s architect, unsatisfied with the delay on certain elements within the scope of Beka’s contract, replaced the company with a different contractor to finish the work.

The difference between what was paid to Beka by the school board and what was owed to them came in at around $400,000, but the plaintiffs sought, and were ultimately awarded, about $1.1 million by the judge yesterday.

The civil suit filed last October slogged its way through complex legal proceedings including several motions to dismiss the case filed by the school board for almost a year before finally coming to trial this week. The trial, docketed for nine days, began with opening statements on Monday and testimony in the case went on through mid-week before Karwacki’s ruling in favor of the plaintiffs late yesterday.

According to a source close to the case, Karwacki told the litigants late Wednesday he was going to proceed with the case until all of the testimony was concluded before adjourning for the night. The proceedings ended at around 7 p.m. on Wednesday night and the case was recessed until 10:30 a.m. yesterday morning.

When the case resumed yesterday, attorneys on both sides gave their closing arguments before Karwacki made his ultimate decision late yesterday afternoon. The judge rendered his opinion in the case less than a minute after school board attorney James Almand concluded his closing statement, despite the fact there were thousands of pages of material and 125 exhibits presented during the three-plus days of the trial.

“I am very disappointed with the outcome,” Almand said yesterday. “With the amount of evidence that was presented over three days of trial, including 125 exhibits, I think the school board had a very strong case.”

During a pre-trial conference back on Sept. 18, the judge ruled against several motions filed by the defendant before the case even went to trial. When the proceedings opened on Monday, Karwacki quickly dispensed with several other pertinent motions filed by the school board including throwing out a counter suit filed by the school board on Sept. 26 seeking over $531,000 from the plaintiffs for amounts paid under the contract for work that was never completed.

Because of some of the perceived irregularities in the handling of the case along with other factors, an appeal is likely although the process could take months or even years to resolve. Reached minutes after the verdict, Superintendent of Schools Dr. Jon Andes could not comment on the case.

Almand said yesterday the school board would ultimately make a decision on an appeal.

“We’ll have to weigh everything and decide which direction we want to go in terms of an appeal,” he said. “The school board could take it up as early as their next meeting.”

In the meantime, the school board, and ostensibly Worcester County, will be required to pay the plaintiff the roughly $1.1 million awarded by the judge yesterday

Coming out on the losing end of the suit was certainly a blow for the Board of Education and the county in general, given the current economic situation. Reached for comment late yesterday, County Commission President Virgil Shockley said the judge’s ruling was certainly a tough pill to swallow for the county.

“We just don’t have $200,000 lying around, much less $1.1 million,” he said. “In these economic times, we simply don’t have that amount of money available without making tough decisions affecting projects or even personnel.”

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